It is the same as if you sold whatever you held in the traditional IRA, moved the cash, and then bought the same thing back in the Roth. The only difference is that if you move the asset rather than cash, then you do not have the transaction costs.
That said, in my opinion, whatever you expect to grow the most over time should be held in the Roth rather than in the traditional IRA. So, that might argue that you should move - for example - equities rather than fixed income, or that you should move something that is currently beaten down and that you think is likely to recover. If you move something that is beaten down, you can move more of it for the same tax cost. (Of course, no one really knows the future and your assumptions may be wrong.)
I have a variant of the same question and searched here before starting a new question. I have $750,000. in an IRA holding a CD that is $200,000., 200+ shares of FFIN, a small Texas bank, and $440,000 in an S&P 500 Index Fund. It was FUSVX before Fidelity moved it to new equivalent fund. I am still eligible to participate in a company 401k plan so I don't think I can contribute to the IRA separately. I might be wrong about that. But I contributed $4000. to the 401K in Jan and Feb and then stopped. I've been pouring money instead (this year) into my taxable account. My real question is: Is Tax Deferred better than paying current taxes?
We've been sold on the idea for decades that our taxes will be lower in retirement than they are today. But I ain't buying it. Right now, we have the lowest income tax rates we've had in 50 years. And facts are stacking up against tax payers I think. Unfunded liabilities of the government; SS and Medicare that they cannot cover. I'm reminded of a bumper sticker I saw "I love my country but I don't trust my government". Taxes are going to be higher my friends. Or we're only going to get about half the SS & healthcare we thought we'd get. I don't like either scenario but everything coming out of Tax Deferred accounts is going to be taxed at ordinary income rates, not cap gains rates. It's true, and in fact likely, that the legislature will increase the cap gains rate to match whatever ordinary income rates might be in the future. But right now is all we got to work with.
ARE TAX DEFERRED accounts really the bargain they've been sold to as being? We have a business partner in those accounts and it's the Treasury Department. The % of their ownership in those deals can change, and we won't even have a vote in the matter.
I would use the 401k as a funnel to Roth conversions. In either the Roth conversion or taxable account cases you pay taxes now at ordinary income tax rates. In the future, there are no further taxes on the Roth account, but taxes on dividends, interest and cap gains in the taxable account. The taxes also affect investment decisions within the taxable account because investors are reluctant to incur a taxable event by selling an appreciated holding. A taxable account would be my last choice.